Source: Ken Mason, Mortgage California
Wednesday’s bond market has opened in negative territory following slightly stronger than expected economic data and a positive open for stocks. The stock markets are extending yesterday’s afternoon rally, but to a much less degree. The Dow is currently up 44 points while the Nasdaq has gained 12 points. The bond market is currently down 9/32, but we may still see a slight improvement in this morning’s rates compared to yesterday’s morning pricing due to strength in bonds late yesterday.
This morning’s first piece of economic data was January's Housing Starts. It revealed a larger than expected increase in starts and an upward revision to December’s starts, hinting that the housing sector may be stronger than thought. Rising starts of new homes indicates more sales or stronger levels of optimism by builders. But, this data is not considered to be highly important to the markets or to mortgage rates. It is the week’s least important data and has not had much of an influence on this morning’s mortgage pricing.
Also posted this morning was January's Industrial Production data. It showed a 0.9% increase in output at U.S. factories, mines and utilities that exceeded forecasts. That indicates a level of manufacturing sector strength that is considered bad news for bonds and mortgage rates. However, this data is considered only moderately important, so it has not hurt mortgage rates this morning.
The third event of the day will be the release of the minutes from last FOMC meeting later today. Traders will be looking for any indication of the Fed’s next move regarding monetary policy. They will be released at 2:00 PM ET, therefore, any reaction will come during afternoon trading. I am expecting some volatility in the markets after the minutes are released.
The Labor Department will post January’s Producer Price Index (PPI) early tomorrow morning. It measures inflationary pressures at the producer level of the economy and is considered to be an important measurement of inflation. There are two portions of the report that analysts watch- the overall reading and the core data reading. The core data is more important to market participants because it excludes more volatile food and energy prices. It is expected to show an increase of 0.8% in the overall reading and a 0.1% rise in the core data.
Good news for bonds would be a decline in both readings, particularly the core data. Also tomorrow morning will be the release of the Leading Economic Indicators (LEI) for January. This Conference Board report attempts to predict economic activity over the next three to six months. It is expected to show a 0.5% increase, meaning that economic activity may rise in the near future. A smaller than expected rise would be good news for the bond market and mortgage rates.
Showing posts with label mortagage rates. Show all posts
Showing posts with label mortagage rates. Show all posts
Wednesday, February 17, 2010
Monday, February 1, 2010
Rates at a Glance
Source: Mortgage California
30 Year Conf Fixed
4.875% 1 point
5/1 Conforming
3.500% 1 point
30 Yr Agency Jumbo
5.00% 1 point
30 Year FHA
4.750% 1 point
5 Year Jumbo
5.00% 1 point
10 Year Jumbo
5.375% 1 point
Rates are subject to change and are for illustrative purposes ONLY
30 Year Conf Fixed
4.875% 1 point
5/1 Conforming
3.500% 1 point
30 Yr Agency Jumbo
5.00% 1 point
30 Year FHA
4.750% 1 point
5 Year Jumbo
5.00% 1 point
10 Year Jumbo
5.375% 1 point
Rates are subject to change and are for illustrative purposes ONLY
Thursday, January 14, 2010
Mortgage and Interest Rate Update
THURSDAY AFTERNOON UPDATE:
The bond market has improved from early gains following a fairly strong 30-year Bond auction. The stock markets have not moved too much from this morning’s levels with the Dow currently up 30 points and the Nasdaq up 8 points. The bond market has improved from this morning, currently up 19/32. This will likely improve this afternoon’s mortgage rates slightly, even after this morning’s improvement. But, many lenders may opt to wait until tomorrow’s pricing to reflect this improvement.
The Commerce Department reported this morning that retail level sales fell 0.3% last month, falling well short of expectations. Analysts were expecting to see a 0.5% increase in sales, meaning consumers spent less last month than many had thought. This is good news for bonds and mortgage rates because drops in consumer spending eases inflation and economic recovery concerns. That creates a favorable environment for the bond market and mortgage rates. However, minimizing this news was a sizable upward revision to November’s sales, indicating that consumers spent more in November than was previously thought.
There are three economic reports scheduled for release tomorrow morning. The first is December’s Consumer Price Index (CPI). This is also one of the most important monthly reports that we see since it measures inflationary pressures at the consumer level of the economy. The overall index is expected to rise 0.2% while the core data is expected to increase 0.1%. Weaker than expected readings should lead to bond improvements and lower mortgage rates tomorrow morning.
December’s Industrial Production report is the second report. It will be released at 9:15 AM ET and measures output at U.S. factories, mines and utilities. This gives us a good indication of manufacturing sector strength or weakness. Current forecasts are calling for an increase in production of 0.6% from November’s level. A smaller than expected increase would be considered good news for bonds and should lead to lower mortgage rates as long as the CPI doesn’t reveal any negative surprises.
The final report of the week is January’s preliminary reading to the University of Michigan’s Index of Consumer Sentiment. This index measures consumer willingness to spend and can usually have enough of an impact on the financial markets to change mortgage rates. Good news would be if it shows a reading weaker than the 73.8 that is expected. However, it is not one of the week’s more important releases and probably will have little impact on tomorrow’s mortgage rates due to the importance of the CPI and production reports.
If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...
Source: Ken Mason, Mortgage California
The bond market has improved from early gains following a fairly strong 30-year Bond auction. The stock markets have not moved too much from this morning’s levels with the Dow currently up 30 points and the Nasdaq up 8 points. The bond market has improved from this morning, currently up 19/32. This will likely improve this afternoon’s mortgage rates slightly, even after this morning’s improvement. But, many lenders may opt to wait until tomorrow’s pricing to reflect this improvement.
The Commerce Department reported this morning that retail level sales fell 0.3% last month, falling well short of expectations. Analysts were expecting to see a 0.5% increase in sales, meaning consumers spent less last month than many had thought. This is good news for bonds and mortgage rates because drops in consumer spending eases inflation and economic recovery concerns. That creates a favorable environment for the bond market and mortgage rates. However, minimizing this news was a sizable upward revision to November’s sales, indicating that consumers spent more in November than was previously thought.
There are three economic reports scheduled for release tomorrow morning. The first is December’s Consumer Price Index (CPI). This is also one of the most important monthly reports that we see since it measures inflationary pressures at the consumer level of the economy. The overall index is expected to rise 0.2% while the core data is expected to increase 0.1%. Weaker than expected readings should lead to bond improvements and lower mortgage rates tomorrow morning.
December’s Industrial Production report is the second report. It will be released at 9:15 AM ET and measures output at U.S. factories, mines and utilities. This gives us a good indication of manufacturing sector strength or weakness. Current forecasts are calling for an increase in production of 0.6% from November’s level. A smaller than expected increase would be considered good news for bonds and should lead to lower mortgage rates as long as the CPI doesn’t reveal any negative surprises.
The final report of the week is January’s preliminary reading to the University of Michigan’s Index of Consumer Sentiment. This index measures consumer willingness to spend and can usually have enough of an impact on the financial markets to change mortgage rates. Good news would be if it shows a reading weaker than the 73.8 that is expected. However, it is not one of the week’s more important releases and probably will have little impact on tomorrow’s mortgage rates due to the importance of the CPI and production reports.
If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...
Source: Ken Mason, Mortgage California
Monday, November 2, 2009
Extension of Current Loan Limits
WASHINGTON, D.C. (October 29, 2009)
The Mortgage Bankers Association (MBA) today applauded passage of legislation that will maintain the existing loan limits for Fannie Mae, Freddie Mac and the Federal Housing Administration (FHA) through December 31, 2010. An extension of the current loan limits (which had been due to expire December 31, 2009) was included in the continuing resolution (H.R. 2996) that passed the House and Senate today.
MBA's Chairman, Robert E. Story, Jr., issued the following statement.
"Given the lack of a private secondary mortgage market, FHA, Fannie Mae and Freddie Mac are pretty much the only game in town. Extending the current loan limits through 2010 will allow more loans to qualify for these important programs and will help keep mortgage credit more accessible and affordable for qualified borrowers.
"As we try to maintain the momentum of the housing recovery, providing affordable financing for qualified borrowers is critical. Extending the loan limits, along with other initiatives such as extending and expanding the homebuyer tax credit, will help restore stability to the housing and mortgage markets."
The Mortgage Bankers Association (MBA) today applauded passage of legislation that will maintain the existing loan limits for Fannie Mae, Freddie Mac and the Federal Housing Administration (FHA) through December 31, 2010. An extension of the current loan limits (which had been due to expire December 31, 2009) was included in the continuing resolution (H.R. 2996) that passed the House and Senate today.
MBA's Chairman, Robert E. Story, Jr., issued the following statement.
"Given the lack of a private secondary mortgage market, FHA, Fannie Mae and Freddie Mac are pretty much the only game in town. Extending the current loan limits through 2010 will allow more loans to qualify for these important programs and will help keep mortgage credit more accessible and affordable for qualified borrowers.
"As we try to maintain the momentum of the housing recovery, providing affordable financing for qualified borrowers is critical. Extending the loan limits, along with other initiatives such as extending and expanding the homebuyer tax credit, will help restore stability to the housing and mortgage markets."
Tuesday, October 27, 2009
Topics To Move Fence Sitters
Topics To Move Fence Sitters:
High Balance Conforming of $729,750 ends 12/30/2009. Reverts back to $625,500. Simultaneous Closing, 1st and 2nd 80% CLTV to $1,250,000 (San Mateo County)
First Time Homebuyers Tax Credit ends 11/30/2009.
Economic News:
Leading economic indicators for September were up 1% and up 11.8% for the last 6 months. Strongest showing since 1983.
New home sales were up for the fifth consecutive month in August. Inventory of new homes are down to their lowest levels since 1990.
The report on Real GDP to be released this week is expected to show an increase of 3.7% annual pace for the 3rd Quarter. By comparisson, first quarter Real GDP was (-6%) Another sign that the economy may have hit bottom and is on a recovery path.
Tuesday, June 2, 2009
Pending Home Sales Gain for Third Month
Source: www.HousingWire.com
Amid mortgage rates holding near record lows and news that some buyers might be able to use the $8,000 first-time home buyer tax credit toward closing costs on government-insured mortgages, home sale transactions picked up for the third consecutive month in April.
An index of pending home sales, calculated by the National Association of Realtors (NAR) from contracts signed in April, indicated a 6.7% month-on-month rise in activity across the US.
“Housing affordability conditions have been at historic highs, but now the $8,000 first-time buyer tax credit is beginning to impact the market,” says Lawrence Yun, NAR’s chief economist, in a media statement today.
“Since first-time buyers must finalize their purchase by November 30 to get the credit, we expect greater activity in the months ahead, and that should spark more sales by repeat buyers,” he adds.
Amid mortgage rates holding near record lows and news that some buyers might be able to use the $8,000 first-time home buyer tax credit toward closing costs on government-insured mortgages, home sale transactions picked up for the third consecutive month in April.
An index of pending home sales, calculated by the National Association of Realtors (NAR) from contracts signed in April, indicated a 6.7% month-on-month rise in activity across the US.
“Housing affordability conditions have been at historic highs, but now the $8,000 first-time buyer tax credit is beginning to impact the market,” says Lawrence Yun, NAR’s chief economist, in a media statement today.
“Since first-time buyers must finalize their purchase by November 30 to get the credit, we expect greater activity in the months ahead, and that should spark more sales by repeat buyers,” he adds.
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